Dow Reaches Record High As U.S. Stocks Add To Yesterday’s Gains

Following the tech-led rally seen in the previous session, stocks are seeing further upside in morning trading on Wednesday. With the early advance, the Dow has reached a new record intraday high.

The major averages have pulled back off their highs in recent trading but currently remain firmly positive. The Dow is up 304.40 points or 1 percent at 32,137.14, the Nasdaq is up 87.93 points or 0.7 percent at 13,161.76 and the S&P 500 is up 22.39 points or 0.6 percent at 3,897.83.

The continued strength on Wall Street comes following the release of a Labor Department report showing tame consumer price inflation in the month of February.

Concerns about inflation have contributed to the recent spike in bond yields, which has resulted in considerable volatility on Wall Street in recent sessions.

Bond yields have pulled back near the unchanged line following the release of the inflation data after moving modestly higher earlier this morning.

The Labor Department said its consumer price index climbed by 0.4 percent in February after rising by 0.3 percent in January. The increase in prices matched expectations.

Gasoline prices led the way higher once again, surging up by 6.4 percent in February following a 7.4 percent spike in January.

Excluding food and energy prices, core consumer prices inched up by 0.1 percent in February after coming in unchanged for two straight months. Economists had expected core prices to rise by 0.2 percent.

On an annual basis, consumer price growth accelerated to 1.7 percent in February from 1.4 percent in January but core price growth slowed to 1.3 percent from 1.4 percent.

Buying interest may also have been generated in reaction to a report from NBC News indicating the U.S. plans to buy 100 million additional doses of Johnson & Johnson’s (JNJ) Covid-19 vaccine.

Later in the day, trading may be impacted by reaction to the results of the Treasury Department’s auction of $38 billion worth of ten-year notes. Demand for the auction could have a notable impact on bond yields.

Traders are also likely to keep an eye on developments in Washington, with the Democrat-controlled House expected to pass the $1.9 trillion relief bill.

Energy stocks are seeing considerable strength in morning trading, benefiting from a rebound by the price of crude oil. Crude for April delivery is climbing $0.59 to $64.60 a barrel after moving sharply lower over the two previous sessions.

Reflecting the strength in the energy sector, the Philadelphia Oil Service Index is up by 2.2 percent, the NYSE Arca Natural Gas Index is up by 2 percent and the NYSE Arca Oil Index is up by 1.4 percent.

Significant strength has also emerged among housing stocks, as reflected by the 2.2 percent jump by the Philadelphia Housing Sector Index.

Banking, chemical, and biotechnology stocks are also seeing notable strength, moving higher along with most of the other major sectors.

In overseas trading, stock markets across the Asia-Pacific region turned in another mixed performance during trading on Wednesday. Japan’s Nikkei 225 Index closed just above the unchanged line, while China’s Shanghai Composite Index edged down by 0.1 percent.

The major European markets have also turned mixed on the day. While the U.K.’s FTSE 100 Index is down by 0.2 percent, the German DAX Index is up by 0.4 percent and the French CAC 40 Index is up by 0.7 percent.

In the bond market, treasuries are nearly unchanged after moving modestly lower early in the session. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, is down by less than a basis point at 1.540 percent.

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